Recruitment agencies have to evolve

Clarkhouse Human Capital's Debbie Booth on how run-of-the-mill recruitment agencies are fast becoming obsolete

Over the last ten years, the recruiting industry has undergone massive changes. Recruiters no longer rely on cold calling and paper advertising to engage candidates. Nowadays candidates can be found within minutes online and recruitment tools like LinkedIn make sourcing candidates seem fast and simple. However, having a large pool to choose from can be daunting, and at the end of the day, modern recruiting is about finding the right person for the job.

Deborah Booth, co-founder and director of Clarkhouse Human Capital, realised that the world of work was changing while she was working for a recruitment company. She realised that recruitment agencies that simply pool CVs together would not exist in five-to-ten years' time because companies will have to become human capital enablers, which is about more than just recruitment - It's more about becoming a true partner to a client and understanding what kind of talent they need both now and in the future. 

“It's not about getting a CV as fast as possible for your client to consider a candidate. It's more about spending the time to get to know the client, understanding the culture of the organisation, and learning about the strategies and philosophies of a particular team before going out o find someone that we think will be a good fit,” says Deborah, adding that recruitment is about finding someone who has the right skills and qualifications as well as the right personality for a particular role.

Although many recruiters are able to find people who have specific qualifications and experience for particular business need, they tend to make the mistake of hiring people based only on their qualifications. But this can lead to hiring candidates who lack the necessary attitudes, motivations and behavioural competencies for a particular job.

Booth says that finding the person with the right attitude who fits the culture of the organisation is very difficult to do and that's why we would rather take more time to really get to know candidates to find the best people for their clients.  Because, while recruiters can perform interviews to assess behavioural profile of a candidate, research has shown that interviews aren’t an effective indicator or how a candidate will behave or react to different situations when they’re on the job.

Technology is changing the business model

Booth says that, if one looks at the different solutions that companies like LinkedIn are already providing in terms artificial intelligence and algorithms, there will soon come a time when 70% - 80% of the recruitment function will be automated. Companies are not going to need a generic recruiter that doesn't add value.

Says Booth: “Somebody that simply goes onto a system and matches key words from a job spec is not going to be needed. There are already systems available that can look through a database and not only tell you which people are right for your roles, but they will also be able to tell you which ones are most likely to be on the job market based on their online activity. A system will be able to tell you, 'here are fifty people that would be right for your organisation, and these 10 are actively looking at the moment.  Clever technology will start to shortlist your short list before you have done any work.”

Technology is also evolving to help internal recruiters become more efficient. With many companies focussing on cost containment, they are increasingly looking for ways to get their internal recruiters to do 60%-70% of their recruitment and this will start to affect the business models of recruitment agencies. It means that, for finding people for generic roles such as PAs, business analysts and office managers, where there is an abundant supply, companies won't need a recruiter. The true value of recruitment agencies will, therefore, be in their ability to fill specialist and rare-talent roles and that's where they position us. 

For skills that are extremely rare, Deborah says companies need recruiters that are able to look for people who can match as much of the job specifications as possible.

"But the job spec itself can also be a problem because typical recruitment agencies tend to simply download a generic job specifications sheet from a different company or one that is outdated. So, even if a role has evolved to require someone with a different skill set, recruiters often don't do the work to find out how that role has changed and what new skills a candidate will need for a particular role. That is why they often have to go through a lot more candidates to find the right fit," she says.

Employee Analytics

Employee analytics is another big trend. A lot of companies spend a lot of money understand the external market, but Debbie says there are still too many that don't spend time trying to understand their internal structures. They have all manner of data at their disposal but don't have the systems in place to apply it and use it to get better results out of their existing workforce.  

"Some technologies will be able to tell you when certain staff members might be starting to look for another job. That could be a signal to managers to pay extra attention to them and make sure they know that they're valued," says Debbie, adding that this is especially the case in companies with typically high turnover rates like call centres, where you have a large volume of staff working in shifts. In a call centre with 2500 people, for example, HR leaders don't have to manage each person one on one, but analytics can allow them to can pick up red flags whereby the technology can tell them that they need to speak to a particular person because the last person that resigned had exhibited similar behavioural patterns. 

That allows companies to get involved and check whether that person is happy before the resignation happens, allowing them to find out what concerns that person is having and address the issue, whether it's a matter of giving them time off or a raise, or whatever the case may be. That saves the company the costs of replacing that employee and having to train them while avoiding the indirect costs of lost productivity as well. 

Ultimately, technology has changed the world of work so much that the HR profession and the recruitment agencies that serve it have to evolve. Because, even though there are a lot more things that will be automated in the future, people will always be central to the HR role. But the days of recruitment being a numbers game are over. It's now about adding value and being able to solve a business need more effectively, as opposed to CV generation.